Indonesia Hardly Escaped from Self-Isolation

Despite its intensifying effort to attract foreign investment, Indonesia has hardly gotten away from its classical problem of self-isolation, Jakarta-based consultancy CastleAsia managing director James Castle said in Jakarta on Thursday.

He gave the example that President Joko “Jokowi” Widodo was now aggressively pursuing free trade agreements (FTAs), yet the government allowed state-owned enterprises (SOEs) to dominate in government projects.

Castle also questioned the requirement for foreign workers to speak Indonesian within six months from entering the country.

“The government simplifies the bureaucracy, but the manpower minister requires you [foreign workers] to speak Indonesian within six months,” said Castle, who was the three-time chairman of the American Chamber of Commerce in Indonesia.

He said that since the Reform Era, Indonesia had not significantly expanded its trade base because the country did not actively seek new trading partners nor pursue FTAs.

“This self-imposed isolation from the international economy prevents Indonesia from growing faster. Five percent economic growth is the best Indonesia can do,” he said at a Jakarta Foreign Correspondents Club seminar in Jakarta.

Meanwhile, Centre for Strategic and International Studies cofounder Jusuf Wanandi told The Jakarta Post that the government allocated more infrastructure projects to SOEs to ensure that the projects could be completed within a certain period of time. “When they [government officials] realize that they cannot move further with SOE schemes, they will give more opportunities to the private sector,” he said.

Courtesy : Thejakartapost
Photo : Jakarta Foreign Correspondents Club

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